Prime Minister Mark Carney speaks on Parliament Hill on Thursday. Infrastructure investors have taken notice of his government's plan to fast-track major projects and raise seed capital for a sovereign wealth fund.DAVE CHAN/AFP/Getty Images
Canada tops the list of the most attractive countries for investing in infrastructure for the first time in a survey of major global investors, suggesting Ottawa’s push to boost the country’s profile is attracting attention.
Canada ranks ahead of the United States, Mexico, Germany and several European and Nordic countries in the latest semi-annual survey by the Global Infrastructure Investor Association (GIIA).
The country’s outlook “improved materially,” according to the survey results, signalling that investors are responding well to the federal government’s plan to launch major projects that can improve Canada’s economic growth and productivity over time.
The U.S. slipped to third place in the ranking, behind second-place Germany, thanks to rising concerns over its war in Iran, an uptick in inflation in March and uncertainty over the outcome of midterm elections later this year.
The survey showed improved outlooks for Britain and most European countries.
The survey had 28 respondents that collectively manage US$1-trillion of infrastructure assets. Those included major Canadian pension funds, Brookfield Asset Management Ltd., JPMorgan Chase & Co., CBRE Group Inc. and Macquarie Asset Management.
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One unnamed respondent cited in the survey said Canada appears to be “having a moment” in the infrastructure sector. Individual survey responses are anonymized.
The GIIA’s members represent nearly US$2.2-trillion of combined infrastructure assets.
“Canada is making all the right noises when it comes to its intentions to attract private capital into building, maintaining, and improving the nation’s infrastructure – with ambitious goals for how and where it will raise this capital," GIIA chief executive officer Jon Phillips said in a statement.
A report based on the survey results says the establishment of a federal Major Projects Office to oversee and fast-track projects in the national interest, significant federal funding allocated to infrastructure investment and “renewed provincial commitments” all supported investors’ improved outlook for Canada.
The GIIA also cited Canada’s plans to launch a $25-billion sovereign wealth fund, and the prospect that the federal government could privatize major airports to raise seed capital for the fund. Canada’s ambition to be an energy superpower, including through nuclear energy, “is also an attractive notion,” the GIIA said.
“If the government can continue to send clear policy signals like reforming airport governance and nuclear innovation, they can convert this investor interest into real deals and capital flow,” Mr. Phillips said.
In a section of the survey focused on perceived barriers to investment, Canada ranked better than the U.S., Britain and Europe on political stability and had the most attractive regulatory regime in relative terms.
But Canada scored worst on the “lack of visibility” of its pipeline of infrastructure projects, suggesting that investors are still looking for proof that Canada will deliver on its lofty promises.